Penalty rates under threat as Abbott mulls IR changes
In July 2010, the then-Opposition Leader Tony Abbott promised that he had âkilled and crematedâ his controversial industrial relations platform known as WorkChoices.
On Tuesday, the Productivity Commission invited Mr Abbottâs government to resurrect key features of the package, including the reinstatement of individual contracts and a watering down of safeguards that ensure new enterprise agreements do not result in lower wages and working conditions.
But the draft recommendations of the Commissionâs workplace relations inquiry enters terrain that even the Howard governmentâs WorkChoices package would not go near.
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One of the most irksome of the recommendations is the proposal to extinguish the existing penalty rates of workers in the hospitality and retail industries while preserving the same entitlements of workers in other parts of the economy.
If this proposal is implemented, the big losers will be part-time and casual workers, most of whom are young people serving beers at local pubs, checking out groceries at supermarkets and cleaning dunnies at footy venues.
Many of these workers are already on minimum pay so the Commissionâs proposed changes to penalties would simply rob them of up to $80 a week, according to the Queensland Council of Unions.
That might not seem much to those of us on an average income or a neat performance-based salary at the Productivity Commission, but for a low-income earner the cost might be a regular visit to the dentist that Medicare doesnât cover.
It makes this writer question the motives of the Productivity Commissionâs economists. Are they objective, well-rounded and rigorous economists, or are they insensitive to the massive, negative impact these measures would have on some workers?
One thing is certain. The Commission is definite about the wisdom of reducing the pay of vulnerable workers on low incomes and mystifyingly opaque about doing anything to rein in the seven-figure salaries of executives.
Tony Abbott runs for the hills
The timing of the Productivity Commissionâs proposals could not have come at a worse time for the Abbott government.
As the public bears down on the abuse of parliamentary allowances by Bronwyn Bishop and Deputy Prime Minister Warren Truss, Australiaâs lowest-paid workers are being told they have to take a hit in the national interest.
Itâs a bad look and the Prime Minister knows it.
Soon after the Productivity Commission announced its plan to cremate the weekend pay entitlements of bartenders and toilet cleaners, Mr Abbott decided to bite his tongue.
He resisted supporting the Commissionâs proposals, saying only that he wanted a âsensible debateâ.
He also said he would not renege on his promise at the 2013 election not to revive the WorkChoices program.
âThis government will make no changes to workplace relations in this term of parliament that are inconsistent with the commitments we took to the election,â he said.
If WorkChoices is dead and cremated, then pie sellers and dunny cleaners have got nothing to worry about.
So long as you can take the PM at his word.
Unions ready to draw the battle lines
ACTU secretary Dave Oliver warned that the Commissionâs proposals were a reworking of the Coalitionâs former WorkChoices policies.
âIt has all the hallmarks of what we saw under the Howard governmentâs WorkChoicesâ legislation,â he said.
âThis has got nothing to do with productivity, itâs about going after the most vulnerable.â
The hospitality industry union, United Voice, believes that the Productivity Commissionâs recommendations are part of a government effort to reintroduce the WorkChoices agenda in a piecemeal form.
United Voice president Jo-anne Schofield said the Commissionâs proposal to introduce âenterprise contractsâ that small businesses would be able to impose on employees.
According to the Commission, the new contracts would permit employers to vary an award for entire classes of employees without having to negotiate with each party individually or to form an enterprise agreement.
âI think the community will turn on this proposal just as they did with Australian Workplace Agreements,â Ms Schofield said.
Insidious recommendation
Perhaps the most insidious proposal stumped up by the Commission is for the workplace relations system to abandon the âbetter off overall testâ.
This principle prevents unions from entering new enterprise agreements that diminish the existing award wages and conditions of employees.
The Productivity Commission wants this principle replaced with a cryptic and ill-defined ânew no disadvantage testâ.
The problem is that the Commission doesnât explain in plain English what this new test is.
Hereâs how the Commission describes the new test:
âThe test against which a new agreement is judged should be applied across a like class (or series of classes) of employees for an enterprise agreement. The Fair Work Commission should provide its members with guidelines on how the new test should be applied.â
Australian taxpayers â who ultimately fund the work of the Commission â deserve better than this from the nationâs productivity experts.
Adding a language communication component to Australian economics degrees would help these people.
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